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Banking on the Poor? Branch Location and Nonfarm Rural Development in Bangladesh

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  • Ravallion, Martin
  • Wodon, Quentin

Abstract

The geographic location of banks' branches is used to test whether they are responding to unexploited gains from nonfarm rural development in Bangladesh. The branch locations of Bangladesh's Grameen Bank are compared with those of traditional banks. The potential gains from switching out of farming are measured, allowing for heterogeneity in household characteristics conducive to success in nonfarm activities. It is found that many farmers are poorly equipped for success in nonfarm enterprises. Even so, seemingly feasible but unrealized gains from switching are revealed. Grameen Bank is attracted to areas where those gains favor the poor. Other banks appear to put higher weight on gains to those other than the poor. Copyright 2000 by Blackwell Publishing Ltd

Suggested Citation

  • Ravallion, Martin & Wodon, Quentin, 2000. "Banking on the Poor? Branch Location and Nonfarm Rural Development in Bangladesh," Review of Development Economics, Wiley Blackwell, vol. 4(2), pages 121-139, June.
  • Handle: RePEc:bla:rdevec:v:4:y:2000:i:2:p:121-39
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    1. repec:wsi:ijitdm:v:16:y:2017:i:01:n:s0219622016500462 is not listed on IDEAS
    2. repec:bla:ausecr:v:49:y:2016:i:4:p:432-452 is not listed on IDEAS
    3. Anna Fruttero & Varun Gauri, 2005. "The Strategic Choices of NGOs: Location Decisions in Rural Bangladesh," Journal of Development Studies, Taylor & Francis Journals, vol. 41(5), pages 759-787.
    4. Mallick, Debdulal, 2012. "Microfinance and Moneylender Interest Rate: Evidence from Bangladesh," World Development, Elsevier, vol. 40(6), pages 1181-1189.
    5. Ajwad, Mohamed Ihsan & Wodon, Quentin, 2007. "Do local Governments maximize access rates to public services across areas?: A test based on marginal benefit incidence analysis," The Quarterly Review of Economics and Finance, Elsevier, vol. 47(2), pages 242-260, May.
    6. Anna Fruttero & Varun Gauri, 2003. "Location decisions and nongovernmental organization motivation : evidence from rural Bangladesh," Policy Research Working Paper Series 3176, The World Bank.
    7. M. Niaz Asadullah, 2016. "Do Pro-Poor Schools Reach Out to the Poor? Location Choice of BRAC and ROSC Schools in Bangladesh," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 49(4), pages 432-452, December.
    8. Ajwad, Mohamed Ishan & Wodon, Quentin, 2002. "Who Benefits from Increased Access to Public Services at the Local Level? A Marginal Benefit Incidence Analysis for Education and Basic Infrastructure," MPRA Paper 12309, University Library of Munich, Germany.

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